Could earlier CC payments offset disaster losses?

Farm organizations and their supporters have written members of the House and Senate asking them to make disaster assistance legislation a priority when they convene the 108th Congress this week.

The letters sent by farm, commodity, lender and manufacturer groups note that 90 percent of U.S. counties were designated disaster areas in 2002 and more than 40 percent were in 2001 and 2002.

Cotton producers have watched their crop shrink by a million bales from earlier forecasts due to droughts in some regions and monsoon-like rains in others. Mid-South growers have seen the quality of their crop drop by one to two grades because of the unusually heavy fall downpours.

But as bleak as the outlook and as deserving of help as farmers may be, those letters may be just another in a growing list of futile exercises that go back to December 2001.

That was when the Senate first took up disaster assistance legislation primarily aimed at Western farmers suffering from the 2001 drought. As with other efforts, that measure went nowhere when Senate leaders decided to pull the plug on any new farm legislation on Christmas Eve.

Some say that, given the budget realities, the same fate could be lurking for any new disaster legislation that Congress might try to pass this winter.

The main obstacle continues to be administration opposition to disaster legislation that does not contain spending offsets in the farm bill. The president, who took a beating from the national news media on the farm bill, has said he won't sign off on any additional spending for agriculture.

Another hurdle: a decision by the president and Republican congressional leaders to make the formerly Democratic-controlled Senate's budget plan conform to that of the House. That means $10 billion less spending than the Senate had anticipated.

“It's difficult to imagine that agriculture will fare well under this exercise,” says Sen. Kent Conrad, D-N.D. “Specifically, it's hard to envision that the drive to reduce domestic spending by billions of dollars will allow for the disaster relief that some of us in Congress have been pursuing, against administration opposition, for several months.”

Conrad, chairman of the Budget Committee until Republicans regained control of the Senate, was one of the first to point out that reductions in farm spending — because of higher commodity prices — could produce savings that could be used for disaster assistance. But the administration has rejected those arguments.

Given the standoff, maybe it's time that farm groups and supporters consider a different tack. Some growers have complained that delaying the farm bill's final counter-cyclical payment for 2002 until next fall is making it impossible for them to cash flow their operations this winter.

If disaster assistance legislation is not in the cards, why not move the final payment up to February or March so farmers could use the funds to pay off debts or convince their lenders they deserve a loan?

Some will ask what difference it makes since the money comes out of the same tap. In the smoke and mirrors world of government accounting, not much. For farmers, it could make all the difference in the world.